November 2020 - Smart Sales Coaching

real estate buyer's agent

Should Real Estate Agents Work with Buyers or Sellers?

Should real estate agents work with buyers or sellers? Almost every agent or industry expert will tell you that, as an agent, you should be working with sellers as much as possible. The conventional wisdom pretty goes as follows: if you want to make real money as a real estate agent or company, then you should be focusing on sellers and gaining listings.

Although this wisdom isn’t necessarily wrong, there are some serious benefits to working with buyers. This is especially true if you are just starting out as a new real estate agent or if you are trying to grow your sphere. Before we dive into that, however, let’s go over what exactly the difference is between a seller’s or listing agent and a buyer’s agent.

Listing Agent vs. Buyer’s Agent

As a real estate or inside sales agent reading this, you are probably well aware of the difference between these two types of agents. But just for any newbies out there, the difference is pretty simple. Basically, a listing agent represents the owner of the property, helps them develop strategic plans for selling it, markets it, gets buyers in the door and to the table, and negotiates with the buyer or buyer’s agent to get the best deal possible for person or party selling the property.

A buyer’s agent, on the other hand, is a representative for the person buying the home or property. They assist the buyer with finding the right house that checks all (or most) of their boxes, shows them houses, and helps negotiate the final deal. Basically, they help the people purchasing the property throughout the entire process and have a fiduciary responsibility to represent and support their interests.

As a quick side note for agents and ISAs wanting to convert more on their calls with buyers, the term fiduciary responsibility is huge here. You might hear a buyer tell you that they are just going to work with the agent listing the property. When they say this, it’s a great opportunity for you to point out that the listing agent has a fiduciary responsibility to get the best deal possible for the seller and has their best interests at heart, not the buyer’s.

Why Everyone Wants to Be Listing Agents

Put simply, most real estate agents want to work with listings because it is much easier to scale. Because you don’t have to show houses and drive all around town with your clients, there is a lot less physical labor involved. A listing agent can have 30, 40, even 50 active listings at any given time, whereas a buyer’s agent could most likely never handle that many clients at once.

Once seller’s agents have the right process in place along with all the necessary administrative and support staff, the only limit they have on growing their business is how many leads they are able to bring in the door (Coincidentally, that’s what we help you do at Smart Inside Sales). If a listing agent has the right team and processes in place to administer and market the listing, then they can really focus on negotiating and closing deals for their clients and finding new clients to work with.

Don’t Discount Being a Buyer’s Agent, Though

The primary drawback to jumping right into being a listing agent is that it is very difficult to do. Once you get going, being a seller’s agent is far more scalable, however it’s not easy to get to that point. More often than not, seller clients have the following mentality: they are paying the commission and so they expect more from their agent than many home buyers do. For that reason, sellers tend to have higher standards, are pickier about who they choose, and so there is much more competition for listing clients as a result.

Buyer clients, on the other hand, tend to be easier to get. Although it’s not true in every situation, their bar is normally set a bit lower, and so it is easier for newer agents to break into the buyer world than into the seller world.

So, What Does that Mean If You Are a New Agent Who Eventually Wants to Work with Sellers?

It means you use buyer clients as stepping stones to sellers. When done right, working with home buyers will eventually build you the following:

In other words, working with buyers helps you build up your network and your sphere. More often than not, you’ll develop a deeper relationship with your buyer clients than with seller clients. If you help a family find their dream home or help find a couple their first home, they are going to be extremely grateful to you. Hopefully, that translates into them thinking of you when it is time to move or sell that home. It can also translate into them becoming your advocate when it comes to their friends or family buying or selling a home.

In other words, by working with buyers, it’s typically easier to get clients, you have a better chance at developing long term relationships with those clients, and you’re building up a base of people that you can eventually sell homes for as well. That first time home buyer will move eventually, and when they do, they’ll hopefully think of the person who helped them find the perfect first house.

Conclusion: You Can Be Successful with Buyers or Sellers

At the end of the day, agents and companies are successful working with buyers or sellers. Some start with buyers and move onto sellers, others work with both buyers and sellers, and others choose to specialize in one or the other. Although specialization is often the key to success in real estate, many real estate companies and agents will use buyers as we discussed—to build future seller business.

The bottom line is that before you can become a successful buyer’s or listing agent, you have to develop the skills to consistently bring in new business. That’s where Smart Inside Sales comes in for the save.

Click here to start generating more real estate clients today.